In both household and commercial applications, water heaters are mostly of the tank type. These water heaters are cylindrical containers in which water is kept continuously hot and ready for use. The water in the tank will cool down after a while which causes the heating system to activate to heat the water back up. Additionally, once the supply of hot water from the tank has been depleted, there is a delay before hot water is available again.
Tankless water heaters heat water as it flows through the device and typically do not retain any water internally except for what is in the heat exchanger coil. A challenge for conventional tankless water heaters is to output the same temperature of water at differing flow rates. In addition, over time the heat exchangers can suffer corrosion and efficiency is reduced.